Ontario Mortgage Arrears Are Expected to Keep Rising Through Mid-2027: What CMHC’s Fall Report Says

What CMHC’s fall report says

Canada Mortgage and Housing Corporation published its fall 2026 Residential Mortgage Industry Report this week, and its message on Ontario is specific: stress is building, unevenly, and Ontario is the province to watch.

According to Canadian Mortgage Trends, which reported on the release, Ontario’s arrears reached 0.32% in the second quarter of 2026, up from 0.21% a year earlier. Arrears here means mortgage payments that are 90 days or more overdue. CMHC’s report says delinquencies have risen in most regions over the past few years and that Ontario’s are approaching levels last seen around 2008. It also says they remain below the historical peaks of the past 30 years, which it reads as borrower stress that is increasing but still contained.

Looking ahead, CMHC expects mortgage delinquencies to rise in Ontario, British Columbia and Atlantic Canada through mid-2027, with Ontario recording the largest increase. In Alberta and Saskatchewan, where it says arrears have declined as energy prices support the economy, CMHC expects them to hold steady.

Where the pressure actually sits

The detail in the report is more useful than the headline. CMHC points to the Greater Toronto and Hamilton Area and to other markets in southwestern Ontario, where it says trade tensions, particularly in manufacturing and the auto sector, and weaker resale conditions may leave already stretched borrowers with fewer ways to sell, refinance or otherwise manage a repayment problem. Its data separates only the GTHA from the rest of the country, so it cannot say how London, Windsor or the smaller southwestern markets compare.

The sharpest signal is in one lender group. CMHC’s table of arrears by lender type for the second quarter of 2026 reads:

• Chartered banks: 0.28% of mortgages 90 days or more behind
• Credit unions: 0.14%
• Other non-bank lenders: 0.27%
• Mortgage investment entities, the private lenders that include mortgage investment corporations: 2.57%, up from 1.83% a year earlier

Within that last group, the Ontario concentration is stark. CMHC says the share of mortgage investment entity balances 90 days or more behind in the GTHA rose from 3.0% in the third quarter of 2023 to 11.1% in the first quarter of 2026, more than three times the figure in the rest of Canada. These lenders accounted for 1.8% of all outstanding mortgage balances in Canada in the first quarter, which is why CMHC says they limit broader market risk.

Why private mortgages are the weak spot

CMHC describes mortgage investment entities as lenders that typically make short-term loans at higher borrowing costs to people who do not qualify with traditional lenders. Its report names three features of the GTHA portfolio that make it fragile when conditions soften:

• Interest-only loans. They made up 69.7% of GTHA private-lender balances in the first quarter, against 57.3% in the rest of Canada. Nothing is paid down, so equity is not built through repayment.
• Thinner equity. The share of uninsured GTHA private-lender balances with a loan-to-value above 80% rose from 1.6% in the first quarter of 2024 to 9.2% in the first quarter of 2026, which CMHC attributes to limited repayment of principal and falling prices.
• Heavy debt loads. Nearly one-third of GTHA private-lender balances sit with borrowers spending more than 60% of their income on debt payments.

CMHC says each of these may be manageable on its own and that together they create a more fragile portfolio, and that part of the rise may reflect delinquent loans staying unresolved for longer. We covered the other side of this problem in our piece on what the regulator is finding in Ontario’s private mortgage market.

What it means if your mortgage is with a bank or credit union

For most homeowners the practical reading is calmer than the headline. CMHC says the largest mortgage renewal shock has probably passed, although some borrowers will still face higher payments, particularly those renewing five-year mortgages taken out in 2021 and, to a lesser extent, in 2022. If market conditions hold, it says more borrowers may renew at costs similar to or below what they pay now.

What the report does change is how much runway a stretched borrower has. CMHC’s concern is that weaker resale conditions leave fewer exits. A homeowner whose payment has become tight and who cannot easily sell or refinance has fewer choices than one who acts early. That is a reason to look at your own file before a renewal, not after a missed payment.

• Know your renewal date, and start looking 120 days out. See our explainer on the 120-day renewal window.
• Test your payment at a few outcomes, not only today’s offer. The calculators on our site will do it, and our Mortgage Renewal page explains the options.
• If you hold a private or alternative mortgage, ask about the term, the exit plan and what happens at maturity well before it arrives.
• If a payment is already tight, speak to your lender or a mortgage broker before a payment is missed. Options exist earlier that do not exist later, though what is available depends on your lender and your file.